Thursday, February 13, 2014

I Can't Find Good Enough People...

… is the burning platform which will require A/E/C leaders to again focus on retaining and developing their employees. Why? Employee turnover is expensive.

 Many studies show that the total cost of losing an employee can range from tens of thousands of dollars to 1.5-2X annual salary. Consider the real “cost” of losing an employee:

• Cost of hiring and onboarding a new person (advertising, interviewing, screening, hiring)
• Lost productivity until the employee is trained by an existing employee
• Lost engagement and therefore a loss of discretionary effort
• Project management along with client service issues as new employees have a longer learning curve
• Pied Piper effect—whenever someone leaves, others take time to ask “why?”, and “should I be looking?”

 Author and researcher Wayne Cascio (Investing in People) says that the residual effect of rounds of layoffs can cause ‘surviving’ employees years to recover their pre-layoffs level of commitment and engagement. Now that we’re seeing an economic recovery, your employees are beginning to gain confidence in the job market. Are they beginning to look for a new job? The past five years have taken its toll on your employees. Training budgets have been slashed, wages frozen, and promotions delayed as employees were asked to “do more with less.” I’m projecting that 2014 will be the year that the war for talent resumes as your now “disengaged” employees start to look for new jobs and start quitting at the same time that your firm is growing and you need to hire even more talent. You’re not just adding to headcount, you’ll be adding AND replacing departing employees.

I don’t think I’m being an alarmist. In fact, Gallup’s 2013: State of the American Workplace Report concludes that only 30% of the workforce are engaged. The scariness of this statistic is amplified in a June 2013 Fast Company post (Creative Conversations) by contributing editor Mark Crowley. Mark metaphorically describes the state of employee engagement in 2013 by asking us to imagine we’re part of a crew team. As you look behind you, you discover that only you and two of your crew mates are rowing your butts off, while five of your fellow rowers are casually looking at the scenery, and remarkably, two are attempting to sink your boat by bringing water on board. Can your crew team win the race? Of course not. But according to the Gallup study, that is precisely what is happening in the workforce. This example is powerfully reinforced in my just-released employee engagement video “Who’s Sinking Your Boat?” ( watch?v=y4nwoZ02AJM).

 I anticipate significant job movement as we head into the new year. Your retention and engagement investments (and goals to become “The Employer of Choice”) should not be analogous to a light switch—you shouldn’t just turn them on or off. You need to have a strategy in place that can sustain the good times, and the “not so good times.” Think of your engagement investments and efforts as a dimmer switch—during financially challenging times, you lower slightly, and during boom times, you elevate slightly, while continuously communicating with your employees the realities of your business challenges and successes.

Companies need to focus on their engagement and retention strategies today to be prepared for tomorrow. These strategies need to focus on the following essential engagement best practices:

1. Create a line of sight describing where the company is going, how you’re going to get there, and what role all of your employees play in helping you get there.

2. Train your first line leaders on creating an engaged culture with their employees. Why? Because the number one driver of employee engagement is one’s relationship with his or her boss.

3. Create a robust communication culture built on transparency, honesty, and consistency.

4. Drive high performance because A players want to work with A players.

5. Foster a culture of celebration and recognition.

 6. Doing well by doing good. Identify both the ‘what’ it is you do (what you sell), along with your ‘why’ (your purpose or mission). This will enable you to crystalize your purpose which will allow you to win in the marketplace. In fact, according to research by Jim Collins (Good to Great), firms that focus on Purpose out-perform their peer group 6X!

Bob Kelleher is an award-winning author, thought leader, keynote speaker, and A/E/C industry expert. Bob is the author of Amazon’s #1 selling employee engagement book for 2011, Louder Than Words: 10 Practical Employee Engagement Steps That Drive Results. Bob is also the founder of: The Employee Engagement Group (

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